The latest reply from the National Healthcare Security Administration! Innovative medical devices, exempt from DRG!
On March 4, the National Healthcare Security Administration issued the Reply to the No. 3298 Proposal of the Fifth Session of the 13th National People’s Congress, in which the National Healthcare Security Administration gave a clear answer to the problem of new medical technology proposed by the deputies to further improve the payment system of medical healthcare security DRGs, and further supported the exemption of innovative medical devices from “DRGS”!
On March 4, the National Healthcare Security Administration issued the Reply to the No. 3298 Proposal of the Fifth Session of the 13th National People’s Congress, in which the National Healthcare Security Administration gave a clear answer to the problem of new medical technology proposed by the deputies to further improve the payment system of medical insurance DRGs, and further supported the exemption of innovative medical devices from “DRGS”!
The National Healthcare Security Administration gives specific support to local medical insurance departments in exploring and establishing relevant mechanisms of CHS-DRG payment support for new medical technologies in the pilot work:
For example, for drugs, medical devices and diagnosis and treatment items that meet certain conditions in Beijing, CHS-DRG payment excluding payment management is included.
In July last year, Beijing Municipal Administration of Healthcare Security issued Notice on Issuance of CHS-DRG Paid New Drug and New Technology Excluding Payment Management (Trial), which proposed a DRG excluding payment method for the first time, clarifying that innovative drugs, innovative medical devices and innovative medical service projects can not be paid according to the DRG way, but paid according to the actual conditions.
Innovative medical devices are exempt from DRGS.
As early as in 2021, the National Healthcare Security Administration made it clear that by the end of 2025, DRG/DIP payment will cover all eligible medical institutions providing inpatient services.
DRG/DIP internalizes drugs and consumables into the operating costs of hospitals in the form of packaged charges, and finally realizes a closed-loop of charge and payment, forcing hospitals to reduce costs and control consumables.
Under such circumstances, it is easy to be afraid to use innovative drugs and devices that have better clinical effects but are more expensive in clinical practice, thus leading to the situation that “bad money drives out good money”. This policy in Beijing has specifically solved this problem.
Earlier, some Healthcare Security researchers believed that Beijing’s policy could be extended to all DRG pilot areas. It is not excluded that cities with relatively mature conditions in all aspects should try to do so.
This time, the State Healthcare Security Administration named and supported the Beijing Municipal Healthcare Security Administration to exempt innovative medical devices from DRGS, which undoubtedly sent a signal of support for this policy to be widely promoted in the country!
Inclusion in healthcare security! Beyond Collective Procurement， innovative medical devices “hold great promise”
In addition to the exemption of “DRGS”, the favorable policy for innovative medical devices, the National Healthcare Security Administration has sent a new signal!
On August 24 last year, the National Healthcare Security Administration issued a reply to the “No. 8013 Recommendation of the Fifth Session of the 13th National People’s Congress”, pointing out that relevant policies will be improved to guide local governments to timely cover eligible innovative medical consumables in accordance with procedures.
This reply is the first time for the state to clarify the way of medical insurance payment for innovative medical consumables. Most innovative medical consumables are hindered in their development because they cannot be included in medical insurance. The reply from the National Healthcare Security Administration will effectively overcome this difficulty and help the high-quality development of innovative medical consumables.
In addition, the National Healthcare Security Administration also pointed out that in the process of centralized procurement, medical institutions should determine the demand according to the historical usage, combined with clinical use and medical technology progress, and reasonably determine the proportion of ribbon according to clinical use characteristics, market competition pattern and the number of selected enterprises, so as to set aside a certain market outside the centralized procurement，and provide space for innovative products to expand the market.
Then on September 3rd last year, the National Healthcare Security Administration issued the Reply of the National Healthcare Security Administration to the No. 4955 Recommendation of the Fifth Session of the 13th National People’s Congress, which made it clear that the procurement of innovative medical devices is not implemented yet, because their use is not mature. Usage is difficult to assess for now.
At the same time, the National Healthcare Security Administration made it clear that innovative medical devices are exempt from collection and included in medical insurance payment, which undoubtedly injected a shot in the arm to relevant enterprises and the market, and also laid a good foundation for the clinical use and further development of innovative medical devices.
189 innovative medical devices approved!
A large number of industrial enterprises have received major benefits
So, what kind of medical devices can be included in the category of “innovative medical devices”?
In the documents of Beijing Municipal Healthcare Security Administration, it is clearly stated that:
For an innovative drug/innovative medical device that meets the requirements, its innovation mainly needs to meet two requirements:
| 1. New general-name drugs/medical devices approved by the drug regulatory authorities to be marketed within three years (including the declaration year and the two natural years before that); Additional medical devices that can be charged separately due to price adjustment within three years. |
| 2. The clinical effect is significantly improved compared with traditional drugs/medical devices. At the same time, to apply for innovative drugs/medical devices, the total number of medical insurance insured personnel in the city must reach more than 50 cases, and rare diseases are not limited by the number of cases. |
From 2014 to 2022, the NMPA approved 189 innovative medical devices. Among them, domestic innovative medical devices involved 134 enterprises in 15 provinces, and imported innovative medical devices involved 8 enterprises in 2 countries. In 2022 alone, the State Food and Drug Administration approved 55 innovative medical devices for the market, an increase of 57.1 percent over 2021.
The core technologies of these innovative products all have Chinese invention patents or invention patent applications which have been disclosed by the patent administration department under The State Council. The main working principle/mechanism of the products is the first of its kind in China and has significant clinical application value.
Obviously, once the approval of innovative devices is completed, it indicates the huge market demand and market vacancy. With the support of the new policy, the admission and clinical use of innovative medical devices usher in significant benefits. For innovative medical device enterprises, it will undoubtedly further enhance the industry competitiveness and market share, and for medical device distributors, it will be a new development opportunity under the great changes in the industry.
China is encouraging China end uses for more domestic products in latest years. Thus, more and more overseas manufacturers are planning localization in China. BradyKnows localization team has extensive experiences in facility establishment, audit, supplier evaluation, manufacturing, registration, and marketing in China. Pls feel free to let us know any questions on China entry via info@bradyknowsmedical.com
Source：HiMed
Translated & edited ：Bradyknows
